Christmas Sales

For public listed retailers, Christmas sales have significant impacts on their share prices. John Lewis claimed that its Christmas sales had been 'very strong' in 2018, and its strong sales helped other retailers to advance their share prices as well that Next's share price rose 4.5 per cent. However, would the Christmas sales provide a reliable prediction of a retailer's value? Christmas sales would definitely improve retailers' quarter revenues, but such improve is not sustainable as Christmas sales were strong last year does not mean Christmas sales will be strong this year or the sales throughout this year will be strong. 

However, the Christmas sales can have some interpretation about the performance of retailers. First, it can indicate which retailer is the favourite choice of consumers. When two retailers offer similar discounts, the one which had higher Christmas sales is more likely to perform better throughout the next year than other one is. Secondly, the numbers can provide information about how consumers like to make their consumption. When comparing the proportion of purchases made online last year with the proportion the year before last year, we can draw a trend for online shopping. We might see that the advance of online shopping is close to an end since people want to make their decisions after touching and trying for certain products or we might see that online shopping is continuing advancing. Thirdly, Christmas sales could reflect people's expectations about the coming year. If people do not expect they will have a good new year, they are likely to save more and spend less on Christmas shopping; and vice versa. However, this is not always true, since during Christmas, people can enjoy incredible discounts; therefore, some people may buy even more to avoid more expensive shopping in the near future and save some future money if they expect a bad year is coming.